Price: Imported soybean stocks are low at ports, among which trading soybeans have fallen to around 23,000 tonnes at Shandong port this week and have almost been sold out. Besides, domestic soybean prices also keep rising at present. Meanwhile, participants are concerned about soybean supply in South America, where it now take longer time to transport, load and quarantine at ports under the spread of the COVID-19. Chinese traders are encouraged to support prices, which is good to the market for imported soybeans. With a myriad of bullish factors, the market for imported soybeans is predicted to keep strengthening in the short run. Participants can keep an eye on whether soybean shipments and logistics in top exporters will be disrupted or not. 

Crush: As operation rates pick up slightly this week (Mar. 21-27), soybean crush at domestic mills totals 1,476,100 tonnes (meal 1,166,119 tonnes and oil 280,459 tonnes), up 89,500 tonnes or 6.45% from 1,386,600 tonnes in the previous week. Meanwhile, operation rates (capacity utilization) are 42.51%, up 2.66 percentage points from 39.85% in the previous week. Soybean crush will continue to rise fractionally next week to around 1.50 mln tonnes, and then it will fall again to 1.39 mln tonnes that following week for soybean shortages. Soybean meal supply will remain tight in the next few weeks under low-level soybean crush.

Soybean crush nationwide is estimated at 6.60 mln tonnes in March at current utilization rate, above 6.3247 mln tonnes in the previous month and but below 7.0243 mln tonnes of the corresponding period last year.

As of this week, soybean crush nationwide totals 39,995,814 tonnes in the soybean crop year of 2019/20 (from October 1st, 2019), down 577,071 tonnes or 1.42% from 40,572,885 tonnes of the same period last year. In calendar year of 2020 (from Jan. 1st, 2020), national soybean crush amounts to 17,969,400 tonnes, up 547,915 tonnes or 3.15% from 17,421,485 tonnes of the corresponding period in 2019. 

Inventory: Imported soybean stocks slightly increase this week, as soybean crush remains at a relatively low level of 1.47 mln tonnes. But the increment is small, for soybean imports are not huge. In the week as of March 27th, imported soybean stocks in mills in domestic coastal regions total 2,503,300 tonnes in main domestic coastal oil mills, up 94,000 tonnes by 3.90% from 2,409,300 tonnes last week yet down by 29.42% from 3,546,800 tonnes of the same period last year. Soybean stocks are forecast to continue to stay relatively low as soybean imports are small in March and April.

Arrivals and the outlook: According to Cofeed, soybean arrivals are 16 cargoes with 1.042 mln tonnes this week, a total of 62 cargoes with 4.0 mln tonnes for March so far. Soybean shipments in Brazil are slower as it takes longer time to quarantine amid the spread of the coronavirus. The import is predicted to be 105 cargoes with 6.881 mln tonnes for April, 8.9 mln tonnes for May, 9.0 mln tonnes for June, 9.0 mln tonnes for July and 8.5 mln tonnes for August. Statistics will be updated every week on account of variable and unstable buying.  

Price: This week (Mar. 23-27), domestic soybean meal prices continue to jump sharply higher. As of this Friday, the price settles up 170-240 yuan/tonne at 3,040-3,220 yuan/tonne in domestic coastal regions. 

Inventory: Soybean meal stocks continue to decrease to a six-an-a-half-year low this week as soybean crush remains at a low level. In the week ending March 27th, soybean meal stocks in mills in domestic coastal regions are 272,700 tonnes, down 53,000 tonnes by 16.27% from 325,700 tonnes last week and down by 56.86% from 632,200 tonnes of the corresponding period last year. Soybean crush will still remain at a low level of 1.50 mln and 1.39 mln tonnes in the next two week, so soybean meal stocks will probably continue to stay low. And the tight supply in soybean meal market may not abate until late April, for soybean imports may be lower than expected in April due to slow shipments in Brazil.

Price: Domestic soybean oil prices continue to rebound this week (Mar 23-27). As of this Friday, the price for GB Grade I settles at 5,540-5,650 yuan/tonne in domestic coastal regions, mostly up 50-120 yuan/tonne with a partial decline of 20 yuan/tonne. 

Inventory: Soybean oil stocks continue to decline, as mills are keeping low operation rates and soybean shipments have been decent recently. In the week ending March 27th, China’s commercial inventory has totaled 1,256,270 tonnes, down 65,260 tonnes by 4.94% from 1,321,530 tonnes last week, down 28,230 tonnes by 2.20% from 1,284,500 tonnes last month, and down 103,730 tonnes by 7.63% from 1,360,000 tonnes of the corresponding period last year. And the five-year average at the same period is 1,156,000 tonnes.